National Grid said Monday that it has agreed to lift a moratorium on new natural gas service in Long Island, Queens and Brooklyn and to begin implementing short-term supply mechanisms that can meet demand for approximately two years.
Since May, National Grid has not been issuing gas permits, citing the need for a delayed pipeline project. National Grid will also pay a $36 million penalty to compensate customers affected by the permit halt, Gov. Andrew Cuomo’s office said.
Additionally, National Grid said in a news release that it will offer $7 million in customer assistance to address hardships as a result of the moratorium.
“This agreement is a victory for customers,” Cuomo said. “National Grid will pay a significant penalty for its failure to address the supply issue, its abuse of its customers, and the adverse economic impact they have caused.”
Cuomo’s office said that National Grid will have to present a long-term options analysis within three months to combat a natural gas shortage, which will be subject to a public review process. The long-term options will be in place and functioning in fall 2021, Cuomo’s office said.
The penalty will support new energy conservation measures and clean energy projects as directed by the director of the New York State Division of the Budget in consultation with the Public Service Commission, Cuomo’s office said.
An independent monitor will be appointed by the Department of Public Service to oversee National Grid’s compliance with the agreement.
The announcement came 13 days after Cuomo wrote a letter threatening to pull National Grid’s public utility license because he said the utility had not found ways to combat gas shortage issues brought on by the delay of a coastal pipeline project.
“The Public Service Law provides that a utility is granted a certificate of public convenience and necessity if the corporation can provide ‘adequate and reliable service’ and the utility’s operation is ‘in the public interest,’” Cuomo said in the letter.
Cuomo called the company’s reliance on the pipeline project for gas, which would take 12 months to build, irresponsible.
“We have worked hard to identify an innovative series of alternatives to meet growing demand. With this agreement, we will present options for long-term supply solutions that ensure our customers have the service they require and desire,” National Grid President John Bruckner said in a statement.
“With the resumption of service, providing support for those affected by the moratorium and further investments in New York’s long-term clean energy future, we are demonstrating our unwavering commitment to delivering on our top priority of providing safe and reliable service,” he continued.
Nassau County Executive Laura Curran celebrated the lifting of the moratorium in a statement and said the move is a chance for a more environmentally friendly Long Island.
“Governor Cuomo has been a fierce advocate for Long Island, and today his leadership has delivered another important victory for our homeowners and businesses. No one should have to worry about keeping the heat on during the holidays and winter months,” Curran said. “I look forward to working with the State and all stakeholders to reach a long term solution that will provide safe, reliable service to consumers while safeguarding Long Island’s clean energy future.”
